Plan Design: Eligibility for Company HSA Contributions

[Guest cole stevenson]

We want to make eligibility for the company HSA contribution contingent in two criteria being satisfied:

1. Employee must enroll in our HDHP

2. Employee must open an HSA account with our HSA trustee

We are hearing that #2 above may be an issue. Specifically it's believed that the comparability rules may be violated if we do not recognize for eligibility purposes HSA accounts that employees may have established on their own. I have searched the comparability guidance and see nothing that explicitly precludes restricting eligibility for the company HSA contribution in this way.

The plan design objective of the #2 criteria is to ease administration of the company HSA contribution. That is we only wanted to establish a single employee data (& funding) interface. It would seem if we have to deposit to *any* HSA established by a given employee that the administration becomes exponentially more complex. What is common design around criteria for company HSA contributions in these early days of HSAs? Is this compliance issue being raised one that others have wrestled with?

Thanks in advance for any reactions or thoughts.

[sloble@crowleyfleck.com]

I think you have a problem with #2 because employees with outside accounts can still be "comparable participating employees" if they are eligible under 223c1 and they have the same category of HDHP coverage. See TR54.4980G-1(q/a-1)